LO 4 (Learning Objective 4: Construct an income statement, statement of retained earnings , and balance sheet) During 2018, Brewster Company earned revenues of $146 million. Brewster incurred, during that same year, salary expense of $28 million, rent expense of $23 million, and utilities expense of $19 million. Brewster declared and paid dividends of $15 million during the year. At December 31, 2018, Brewster had cash of $175 million, accounts receivable of $85 million, property and equipment of $39 million, and other long-term assets of $25 million. At December 31, 2018, the company owed accounts payable of $56 million and had a long-term note payable of $33 million. Brewster began 2018 with a balance in retained earnings of $76 million At December 31.2018. Brewster had total stockholders' equity of $235 million, which consisted of common stock and retained earnings. Brewster has a year-end of December 31. Prepare the following financial statements (with proper headings) for 2018. 1. Income statement. 2. Statement of retained earnings, and 3. Balance sheet.
LO 4 (Learning Objective 4: Construct an income statement, statement of retained earnings , and balance sheet) During 2018, Brewster Company earned revenues of $146 million. Brewster incurred, during that same year, salary expense of $28 million, rent expense of $23 million, and utilities expense of $19 million. Brewster declared and paid dividends of $15 million during the year. At December 31, 2018, Brewster had cash of $175 million, accounts receivable of $85 million, property and equipment of $39 million, and other long-term assets of $25 million. At December 31, 2018, the company owed accounts payable of $56 million and had a long-term note payable of $33 million. Brewster began 2018 with a balance in retained earnings of $76 million At December 31.2018. Brewster had total stockholders' equity of $235 million, which consisted of common stock and retained earnings. Brewster has a year-end of December 31. Prepare the following financial statements (with proper headings) for 2018. 1. Income statement. 2. Statement of retained earnings, and 3. Balance sheet.
Solution Summary: The author explains how to prepare the income statement for Company B for the year ended December 31, 2018.
(Learning Objective 4: Construct an income statement, statement of retained earnings, and balance sheet) During 2018, Brewster Company earned revenues of $146 million. Brewster incurred, during that same year, salary expense of $28 million, rent expense of $23 million, and utilities expense of $19 million. Brewster declared and paid dividends of $15 million during the year. At December 31, 2018, Brewster had cash of $175 million, accounts receivable of $85 million, property and equipment of $39 million, and other long-term assets of $25 million. At December 31, 2018, the company owed accounts payable of $56 million and had a long-term note payable of $33 million. Brewster began 2018 with a balance in retained earnings of $76 million At December 31.2018. Brewster had total stockholders' equity of $235 million, which consisted of common stock and retained earnings. Brewster has a year-end of December 31. Prepare the following financial statements (with proper headings) for 2018.
1. Income statement.
2. Statement of retained earnings, and
3. Balance sheet.
Definition Definition Assets available to stockholders after a company's liabilities are paid off. Stockholders’ equity is also sometimes referred to as owner's equity. A stockholders’ equity or book value generally includes common stock, preferred stock, and retained earnings and is an indicator of a company's financial strength.
Learning Objective 7: Calculate return on assets) In 2018, Ambrosia Corporation LO 7reported $100 million in sales, $18 million in net income, and average total assets of $200 million.What is Ambrosia’s return on assets in 2018?
S3-1. (Learning Objective 1: Explain how accrual accounting differs from cash-basisaccounting) Southeast Corporation made sales of $950 million during 2018. Of this amount,Southeast collected cash for $876 million. The company’s cost of goods sold was $260 million,and all other expenses for the year totaled $275 million. Also during 2018, Southeast paid $410million for its inventory and $250 million for everything else. Beginning cash was $75 million.a. How much was Southeast’s net income for 2018?b. How much was Southeast’s cash balance at the end of 2018?
(Learning Objective 7: Calculate return on assets) Handley Grocery Corporationreported the following information in its comparative financial statements for the fiscal yearended January 31, 2018:January 31,2018January 31,2017Net sales....................................Net earnings..............................Average total assets...................$50,000$ 2,200$40,000$48,350$ 2,100$39,300Requirements1. Compute the net profit margin ratio for the years ended January 31, 2018, and 2017. Did itimprove or worsen in 2018?2. Compute asset turnover for the years ended January 31, 2018, and 2017. Did it improve orworsen in 2018?3. Compute return on assets for the years ended January 31, 2018, and 2017. Did it improveor worsen in 2018? Which component—net profit margin ratio or asset turnover—wasmostly responsible for the change in the company’s return on assets?
Chapter 1 Solutions
Financial Accounting Plus MyLab Accounting with Pearson eText -- Access Card Package (12th Edition)
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